MOSCOW , Russia -LRB- CNN -RRB- -- Russia 's finance minister made a rare admission of responsibility Monday for the country 's severe economic crisis .

Russia 's Finance Minister Alexei Kudrin says his country 's economy has been set back by five years .

The Russian government overspent its vast oil revenues in recent years , fueling inflation , and did not do enough to reduce the economy 's reliance on oil , Finance Minister Alexei Kudrin said in an exclusive CNN interview .

`` Of course , I too bear the responsibility for not managing to diversify the economy as much as we wanted , '' Kudrin said . `` We were spending more money than we could afford , which is why we had a rapid strengthening of the national currency -LSB- and -RSB- a high inflation rate .

`` I think the government should have been more conservative in its financial policy and save more money that it received from the high global oil prices , '' he said .

Kremlin officials usually blame the West , and specifically the United States , for the global economic crisis .

Kudrin , who is also a deputy prime minister , said the financial crisis had set back Russian shares -- but added that the United States had fared even worse .

`` If we are talking about the Russian stock market , it had been growing quickly over the past few years and then dropped rapidly . But we only retreated back five years , as far as I know , U.S. stock markets have fallen back 10 years . '' Watch CNN 's exclusive interview with Russia 's finance minister ''

The Dow Jones index of leading shares hit lows not seen since 1997 on Monday . Kudrin confirmed Russia would have a budget deficit of 8 percent in 2009 -- its first for a decade -- and will spend more than it takes in for the next two years as well .

He predicted a deficit of 5 percent in 2010 and 3 percent in 2011 .

Russian government budget forecasts assumed oil would cost $ 95 a barrel -- more than twice as much as it costs at the moment . The lower price hurt Russia , one of the world 's largest oil exporters .

But Kudrin said Moscow would not cut spending , though it would change its priorities .

`` In general , the volume of spending will remain the same , and even slightly increase , which is why the deficit will go up to 8 percent , '' he said .

`` We need to optimize our spending and cut certain programs , '' he added .

`` First of all , we halted all brand new programs and all new projects . In some cases we 've also cut government institutions and government employees ' payroll . Besides , we 've decreased funding for less important projects by 50 percent and more . But by and large social spending and important infrastructure projects remain untouched . ''

Russia 's stock markets plummeted by nearly 70 percent in 2008 , and the country spent one-third of its gold and foreign currency reserves -- or $ 216 billion -- defending its currency , the ruble . The Kremlin has also committed vast sums to bail out big business in Russia , which is heavily in debt to foreign banks .

Kudrin -- who is attending a global investment forum in Moscow -- said there were signs the Russian economy was stabilizing . He confirmed that investors pulled $ 40 billion out of Russia in January , but said that enormous outflows of cash had stopped .

The flight of capital was related to the much-anticipated fall in the value of the currency , he said .

`` People have been expecting a devaluation of the Russian ruble , there were a lot of expectations of new devaluation to take place . That 's why , before the end of January , before the devaluation was actually completed , there was a very strong incentive to take capital out of Russia . However , in February , such capital outflow practically ended . ''

CNN 's Michael Sefanov and Matthew Chance contributed to this report .

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Russian has overspent vast oil revenues in recent years , finance minister says

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Failure to diversify national economy also hampering economy

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Crisis has set Russian stock market back five years , Kudrin says